Samsung back on top as world’s biggest smartphone manufacturer

Samsung has reclaimed the top spot in global smartphone sales, beating Apple and Lenovo, despite its profits slipping 39%.

Samsung sold 83.2m smartphones globally in the first quarter of 2015, according to data from research firm Strategy Analytics, reclaiming the top spot from Apple which sold 61.2m iPhones in the same period. In total, 345m smartphones were sold globally.

Both Samsung and Apple have a healthy margin over the third biggest smartphone manufacturer Lenovo-Motorola, which sold 18.8m smartphones, and fourth placed Huawei, which sold 17.3m.

Samsung’s sale figures come as it announced a slump in its smartphone profits, which generated 2.74 trillion won (£1.6bn) in quarterly profit down 58% compared with 6.43 trillion won a year earlier.

The underperforming mobile division dragged the company’s net profit down to 4.63 trillion won, compared with 7.49 trillion won a year earlier.

iPhone impact

Apple’s launch of the iPhone 6 and iPhone 6 Plus, which are both larger than the 4in iPhone 5S from 2013, ate into Samsung’s high-end smartphone sales. Those seeking larger smartphones finally had an iPhone option; until that point, large screens in excess of 5in were a feature that set Samsung apart.

Data from Counterpoint Technology Market Research indicates sales of iPhones were also strong in countries where Samsung’s presence looms large, such as its home market South Korea and Vietnam, which has Samsung’s biggest phone factory.

The Korean company said its profits will increase during the second quarter as the Galaxy S6 and S6 Edge expand sales after their global launch this month. The two models have garnered positive reviews and demand for the curved screen Edge phone has seen Samsung struggle to keep up with the production quantity required.

“Galaxy S6 sales have been going as well as expected, while demand for the Galaxy S6 edge have been better than anticipated,” Samsung Vice President Park Jin-young said during a conference call.

Shipments of its high-end phones will not be big enough to offset an expected decrease in sales of middle- to low-end models, Samsung said.

Betting big on Samsung’s ‘iPhone killer’

Samsung is betting big on its Galaxy S6 to reclaim lost ground in key markets such as China, where it faces strong competition from not only Apple, but local players such as Xiaomi.

The initial sales of the S6 were “great” but the pre-orders of Samsung’s new smartphones were “no match to the iPhone 6,” said Tom Kang, director at Counterpoint.

Analysts said the improvement in Samsung’s mobile profit hinges on how quickly the company can catch up with demand for the S6 Edge smartphones, which cost approximately £160 more than the S6. But even then, they questioned if the Galaxy S6 series would be strong enough to stave off competition from the bigger iPhones.

“The shipments of the plain S6 model and the Edge model will be not bad, but it won’t be surprising,” said Peter Yu, an analyst at BNP Paribas. “What is important is how many they can sell during the second half of this year.”